The Director General of the Manufacturers Association of Nigeria (MAN), Segun Ajayi-Kadiri, has urged the Federal Government to fully privatise the country?s state-owned refineries, describing them as a ?pure drain on the Nigerian economy.?

Ajayi-Kadiri, who was a guest on Channels Television?s Politics Today, argued that the government should hand over the Port Harcourt, Warri, and Kaduna refineries to the private sector for efficient management and productivity.

?If you ask me, the government should just sell these refineries. Give them to private sector people who will run them efficiently and be able to deliver. When something belongs to everybody, it belongs to nobody,? Ajayi-Kadiri said on Tuesday.

The federal government began efforts in 2024 to revive its four state-owned refineries, with the old Port Harcourt and Warri refineries partially restored, while rehabilitation continues on the second Port Harcourt unit and the Kaduna refinery.

However, the MAN DG lamented that the continued government ownership of the facilities has not only proven ineffective but also unfair to the Nigerian people, especially in a country brimming with capable entrepreneurs.

?Those four refineries are a pure drain on the Nigerian economy, and it is not fair to the Nigerian people. We should have a situation where we are able to speak truth to ourselves and encourage private sector investment,? he stated.

Ajayi-Kadiri insisted that a fully privatised model would reduce corruption and promote accountability in the energy sector.

?It?s our natural endowment. We are the sixth-largest producer of crude oil in the world, yet we suffer. I can tell you that if you completely go private, it will be difficult for anyone to steal.

?It will be difficult for anybody to be unaccountable. It will be difficult to keep having insinuations of massive fraud.?

No Monopoly, Privatise Refineries

Nigeria currently has four major state-owned refineries?two in Port Harcourt, one in Warri, and one in Kaduna?all of which have faced long-standing issues of inefficiency and underperformance.

In contrast, the Dangote Refinery in Lagos has raised hopes of reducing fuel imports and boosting local refining, though it has also sparked concerns about potential monopoly in Nigeria?s energy sector.

The Dangote Refinery was commissioned in May 2023.

Responding to a question on what single reform could best support manufacturers, Ajayi-Kadiri called for total privatisation of all public refineries and greater investment in power infrastructure.

?The government should completely privatise all the other refineries. They should ensure that the ?naira for crude? policy is sustainable, adequately funded, and supported. Also, we need to address the incompetent distribution companies (DisCos) and drive investment into the power sector to guarantee supply,? the MAN DG stated.

Gantry at the Dangote Refinery

On concerns about market monopoly with the emergence of the Dangote Refinery, Ajayi-Kadiri dismissed such fears, saying competition remains viable.

?I do not subscribe to the view that we are creating a monopoly. Those four other refineries are potential competitors. We?ve been told that one is working, then again told that it?s not. Give them to people who will ensure they actually work,? he said.

?Subsidy Removal Necessary?

Nigeria?s President Bola Ahmed Tinubu (2nd right), takes his oath of office during the swearing in of a new Nigerian president at Eagle Square in Abuja, Nigeria on May 29, 2023. Photo: Sodiq Adelakun

After taking office in May 2023, President Tinubu rolled out major economic reforms aimed at stabilising Nigeria?s finances, with backing from international partners.

However, these policies triggered a severe cost-of-living crisis. Petrol prices soared, driving up transport fares, food prices, and basic living expenses?leaving nearly half of Nigerians living in poverty by 2024.

Speaking on the outlook for fuel prices following subsidy removal, he defended the policy, stating it was necessary to avoid an economic collapse.

?If Nigeria didn?t stop the subsidy, the subsidy would have stopped or killed us,? he said.

He added that manufacturers are optimistic about price stability in the sector, hinting at a possible reduction in petrol prices.

?It is going to be better. I see the price coming down to N800, and that is what manufacturers want,? the MAN DG said.

He also stressed the need to tackle insecurity across the country, which he described as a growing disincentive to investment.

Ajayi-Kadiri further revealed that manufacturers spent over ?2 trillion on alternative energy in 2023 alone due to unreliable power supply?a cost he said directly impacts the final price of goods and hinders industrial productivity. (Channels TV)

Update news